Climate Change Data

Watts Water Technologies, Inc.

Climate Impact & Sustainability Data (2021, 2022, 2023)

Reporting Period: 2021

Environmental Metrics

Total Carbon Emissions:26,073 MTCO2e/year (Scope 1+2)
Scope 1 Emissions:11,845 MTCO2e/year
Scope 2 Emissions:14,228 MTCO2e/year
Scope 3 Emissions:1,049 MTCO2e/year
Renewable Energy Share:11% (from RECs)
Total Energy Consumption:129,856 MWh/year
Water Consumption:111,903,727 liters/year
Waste Generated:2,151,435 kg hazardous waste/year
Carbon Intensity:14.41 MTCO2e/$1M (Scope 1+2)

ESG Focus Areas

  • Climate change
  • Water stewardship
  • Diversity, Equity, and Inclusion (DEI)
  • Employee well-being
  • Supply chain responsibility
  • Corporate governance
  • Data security and privacy
  • Sustainable innovation
  • Energy and emissions
  • Waste reduction

Environmental Achievements

  • Exceeded waste, energy, and water intensity reduction targets (43% GHG intensity reduction, 56% water intensity reduction, 9.78% hazardous waste intensity reduction)
  • Purchased 100% certified renewable energy credits (RECs) to offset annual electric consumption at seven U.S. sites, reducing carbon emissions by 20%
  • Achieved ISO 14001 certification at 13 sites (52% of global manufacturing footprint)

Social Achievements

  • Achieved zero recordable injuries at 13 sites
  • Hosted dozens of on-site COVID-19 vaccination clinics and provided U.S. employees paid time off for vaccination
  • Provided clean, safe drinking water for 10,000+ people through partnership with Planet Water Foundation
  • Implemented a strategic DEI plan with goals for 2022
  • Adjusted wages for hourly employees in the U.S. and Europe
  • Piloted hybrid work practices at corporate headquarters

Governance Achievements

  • Appointed a Chief Sustainability Officer
  • Renamed Nominating and Corporate Governance Committee to Governance and Sustainability Committee
  • Improved supply chain responsibility through enhanced due diligence and supplier audits
  • Achieved 99% employee completion rate for Code of Business Conduct training
  • No confirmed incidents of corruption or legal actions related to corruption or anti-competitive behavior

Climate Goals & Targets

Medium-term Goals:
  • Derive 25% of revenue from smart and connected solutions by 2023/24
Short-term Goals:
  • Reduce water intensity by 3% annually
  • Reduce GHG emissions intensity by 3% annually

Environmental Challenges

  • Supply chain disruptions
  • Inflationary pressures
  • Global water scarcity and contamination
  • Climate change impacts (extreme weather, water scarcity)
  • COVID-19 pandemic
Mitigation Strategies
  • Developed alternative sourcing strategies
  • Implemented water stewardship programs at eight sites
  • Purchased RECs to offset emissions
  • Improved business continuity planning
  • Hosted COVID-19 vaccination clinics and provided paid time off for vaccination

Supply Chain Management

Supplier Audits: 701 suppliers audited (30% of global supplier footprint)

Responsible Procurement
  • Supplier Quality Manual
  • Code of Business Conduct
  • Supplier ESG Standards
  • Anti-Corruption Policy
  • Global Anti-Human Trafficking Policy
  • Conflict Minerals Policy

Climate-Related Risks & Opportunities

Physical Risks
  • Extreme weather
  • Water scarcity
Opportunities
  • Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI Standards: Core Option, SASB, UN Global Compact (joined in 2022), UN Sustainable Development Goals (SDGs)

Certifications: ISO 14001, ISO 45001

Third-party Assurance: Lucideon CICS Limited (limited assurance for environmental data)

UN Sustainable Development Goals

  • SDG 5: Gender Equality
  • SDG 6: Clean Water and Sanitation
  • SDG 8: Decent Work and Economic Growth
  • SDG 9: Industry, Innovation, and Infrastructure
  • SDG 12: Responsible Consumption and Production
  • SDG 13: Climate Action
  • SDG 14: Life Below Water

Watts' products and initiatives contribute to these goals through water conservation, energy efficiency, sustainable manufacturing practices, DEI initiatives, and community engagement

Sustainable Products & Innovation

  • Smart and connected products (IntelliStation®, IntelliFlow®)
  • Energy-efficient boilers and water heaters (AERCO®, PVI®)
  • Water conservation products (ZeroWaste® RO System, BLÜCHER HygienicPro® drains)
  • Leak detection systems

Awards & Recognition

  • Newsweek's America's Most Responsible Companies (three years in a row)

Reporting Period: 2022

Environmental Metrics

Total Carbon Emissions:22,709.77 tCO2e/year (market-based)
Scope 1 Emissions:11,330 tCO2e/year
Scope 2 Emissions:8,226 tCO2e/year (market-based)
Scope 3 Emissions:3,153 tCO2e/year
Renewable Energy Share:22% (from RECs)
Total Energy Consumption:121,872.74 MWh/year
Water Consumption:105,000,652 liters/year
Waste Generated:2,307,093 kg/year (hazardous)
Carbon Intensity:9.73 MTCO2e/$1M (market-based)

ESG Focus Areas

  • Climate Change
  • Water Stewardship
  • Diversity, Equity, and Inclusion
  • Occupational Health and Safety
  • Responsible Supply Chain
  • Ethics and Compliance

Environmental Achievements

  • Reduced GHG emissions intensity by 33% (location-based) and 45% (market-based) since 2018 (vs. 12% goal)
  • Reduced water intensity by 62% since 2018 (vs. 12% goal)
  • Reduced hazardous waste intensity by 12% since 2018 (vs. 12% goal)
  • Became the first company to be verified by The Water Council’s WAVE: Water Stewardship Verified program

Social Achievements

  • Launched global, multi-year leadership and inclusivity training for all employees
  • Achieved zero recordable injuries at 14 operating and distribution sites
  • Improved total recordable incident rate (TRIR) by 13% and lost time rate (LTIR) by 7% year-over-year
  • Provided clean, safe drinking water to over 10,000 people

Governance Achievements

  • Completed a global survey of the compliance program showing overwhelming employee belief in adherence to the Code of Conduct
  • Implemented a formal Human Rights Policy
  • Increased the number of suppliers participating in sustainability audits by 14%

Climate Goals & Targets

Short-term Goals:
  • Reduce water consumption by 3% annually
  • Reduce GHG emissions intensity by 3% annually
  • Achieve 25% of revenue from smart and connected enabled products by end of 2023

Environmental Challenges

  • Significant inflation and supply chain disruptions
  • Ongoing war in Ukraine contributing to energy-supply concerns and increased energy costs
  • Increased hazardous waste generation due to the Franklin, NH foundry decommissioning project
Mitigation Strategies
  • Developed alternative sourcing strategies
  • Implemented efficient solutions and adopted an emissions-reduction mindset
  • Purchased renewable energy credits (RECs) to offset emissions
  • Implemented various measures to reduce heating demand through natural gas

Supply Chain Management

Supplier Audits: 826 suppliers audited in 2022 (29% of global supplier footprint)

Responsible Procurement
  • Supplier Quality Manual
  • Code of Business Conduct
  • Supplier ESG Standards
  • Anti-corruption Policy
  • Global Anti-Human Trafficking Policy
  • Conflict Minerals Policy

Climate-Related Risks & Opportunities

Physical Risks
  • Severe weather events
  • Increased scarcity of natural resources
Opportunities
  • Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI, SASB, UNGC, CEO Water Mandate

Certifications: ISO 14001, ISO 45001

Third-party Assurance: Lucideon (limited assurance for environmental data)

UN Sustainable Development Goals

  • SDG 5
  • SDG 6
  • SDG 8
  • SDG 9
  • SDG 12
  • SDG 13
  • SDG 14

Details provided in the SDG Index section of the Appendix.

Sustainable Products & Innovation

  • Smart and connected enabled products
  • High-efficiency boilers and water heaters
  • Lead-free products
  • Backflow prevention valves
  • Water filtration systems
  • Leak detection systems

Awards & Recognition

  • Newsweek’s Most Responsible Companies (four consecutive years)

Reporting Period: 2023

Environmental Metrics

Scope 1 Emissions:9,760 tCO2e/year
Scope 2 Emissions:8,124 tCO2e/year (market-based)
Scope 3 Emissions:5,640 tCO2e/year (business travel)
Renewable Energy Share:28%
Total Energy Consumption:111,714 MWh/year
Water Consumption:108,280,338 liters/year
Carbon Intensity:9.02 MTCO2e/$M (market-based)

ESG Focus Areas

  • Employee Attraction, Development, and Retention
  • Diversity, Equity, and Inclusion (DEI)
  • Occupational Health and Safety
  • Energy and Emissions
  • Sustainable Innovation and Digital Transformation
  • Climate Change Risk and Resilience
  • Water Stewardship
  • Ethics, Integrity, and Transparency
  • Governance and Accountability
  • Responsible Supply Chain

Environmental Achievements

  • 62% reduction in water use intensity since 2018 (vs. a goal of 15%)
  • 60% reduction in Scope 1 & 2 GHG emissions intensity since 2018 (vs. a goal of 15%)
  • 35% reduction in hazardous waste intensity since 2018 (vs. a goal of 15%)
  • Installation of solar at four manufacturing facilities, generating ~700,000 kWh of electricity
  • Purchase of ~7,200 metric tons of CO2 equivalent (MTCO2e) certified wind RECs (representing 47% of market-based emissions)

Social Achievements

  • Headquarters named one of the Top Places to Work by The Boston Globe
  • Provided clean drinking water to nearly 15,000 children and community members through partnership with Planet Water Foundation
  • Commitment to donate up to $1 million to water-related nonprofits from 2024-2027
  • Improved safety performance with a TRIR of 0.92 and LTIR of 0.49 (improvements of 21% and 6% year-over-year, respectively)
  • Launched a quarterly training and development calendar

Governance Achievements

  • 99% of employees completed Code of Business Conduct training
  • Enhanced supply chain visibility through engagement with top 100 suppliers using EcoVadis
  • No confirmed incidents of corruption

Climate Goals & Targets

Long-term Goals:
  • Reduce absolute GHG emissions by 30% by 2034
Medium-term Goals:
  • Begin reporting on Scope 3 emissions in 2026
  • Reduce hazardous waste intensity by 3% annually through 2026
Short-term Goals:
  • Reduce water intensity by 3% annually through 2026
  • Complete LCAs for all products in largest facility by 2025
  • Complete LCAs for all products in BLÜCHER facility by 2025
  • Offer leadership and inclusivity training to all employees globally by the end of 2025
  • Complete 50 EPDs by 2026

Environmental Challenges

  • Supply chain disruptions
  • Increased energy costs
  • Global water crisis
  • Climate change impacts
Mitigation Strategies
  • Reduced dependence on sole sources and prioritized local sourcing
  • Implemented energy efficiency measures (air leak detection, on-site solar, LEDs)
  • Purchased RECs
  • Developed alternative sourcing strategies
  • Committed to new decarbonization goals (30% absolute reduction in Scope 1 & 2 emissions by 2034)

Supply Chain Management

Supplier Audits: 1,075/year (22% of global direct spend)

Responsible Procurement
  • Code of Business Conduct
  • Supplier ESG Standards
  • Dun & Bradstreet ESG Rating Service
  • EcoVadis

Climate-Related Risks & Opportunities

Physical Risks
  • Extreme weather events
  • Increased scarcity of natural resources
Transition Risks
  • Legislation and regulation around natural gas use
Opportunities
  • Development of energy-efficient products
  • Electrification

Reporting Standards

Frameworks Used: GRI, SASB, UNGC, CEO Water Mandate

Certifications: ISO 14001, ISO 45001

Third-party Assurance: Lucideon

UN Sustainable Development Goals

  • SDG 5
  • SDG 6
  • SDG 8
  • SDG 9
  • SDG 12
  • SDG 13
  • SDG 14

Watts' strategy is aligned with these SDGs through various initiatives detailed in the report.

Sustainable Products & Innovation

  • Electrically powered water heating products
  • Smart and connected enabled products

Awards & Recognition

  • America’s Most Responsible Companies (Newsweek)
  • America’s Greenest Companies (Newsweek)
  • America’s Climate Leaders (USA Today)